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SGX issues consultation paper on secondary listings

The Singapore Exchange (SGX) has issued a public consultation paper on secondary listings -- in particular on the regulatory framework for such listings.

SINGAPORE: The Singapore Exchange (SGX) has issued a public consultation paper on secondary listings -- in particular on the regulatory framework for such listings.

SGX is seeking to make the listing process more transparent.

Currently, it reviews the regulatory requirements of the home exchange for each company on a case-by-case basis.

But going forward, it plans to classify secondary listings into two groups -- those from developed and developing markets based on index providers FTSE and MSCI classifications.

For companies from developed markets, SGX will not impose additional continuing listing obligations.

But additional continuing listing obligations will be imposed on companies from developing markets. This is to enhance shareholder protection and corporate governance standards.

SGX said it hopes the greater clarity will draw interest from firms already listed in developed jurisdictions.

Simon Lim, senior vice president and head of listings (Southeast Asia) at the Singapore Exchange, said: "Perhaps we'll find interest from some of these developed jurisdictions.

"These companies... may now say 'Going forward, it's very clear -- if I want to consider a secondary listing in a Singapore context, I don't actually have to comply with any additional conditions'.

"And I think that will always be very helpful from an issuer perspective."

Currently, there are 33 companies with a secondary listing on SGX, up from the 26 secondary listings in 2010.

The changes will affect some companies from developed markets, including mainboard-listed Jardine Matheson, Jardine Strategic and Lonza.

Mohamed Nasser Ismail, head of Issuer Regulation at Singapore Exchange, said: "Once the proposal has been accepted and implemented, there will be a three-month time frame, after which any conditions imposed on these companies from developed markets will no longer apply.

"This three-month period will give investors sufficient time to decide whether they want to continue with their investment in these companies. As for the companies from developing markets, the conditions that are imposed on them will continue to apply."

SGX hopes to implement the new framework by the fourth quarter of this year.

The public consultation process ends on June 25. 

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